JSC BTA Bank v Ablyazov & Ors [2014] EWHC 2788 (Comm) (08 August 2014)

JSC BTA Bank v Ablyazov & Ors [2014] EWHC 2788 (Comm) (08 August 2014)

There is a strong prima facie case that Mr Ablyazov and Mr Shalabayev engaged in a deliberate and systematic strategy of fraud, perjury, and concealment of assets, and that their solicitors were unwittingly used to further this iniquitous purpose. Accordingly, the iniquity exception to legal professional privilege applies, and the solicitors must disclose documents relating to the assets of Mr Ablyazov and Mr Shalabayev, as such communications do not attract privilege. The Bank is entitled to the disclosure sought, subject to safeguards for third-party privilege and proportionality.

Citation
[2014] EWHC 2788 (Comm)
Parties
Claimant: JSC BTA Bank; Defendant/respondent: Mukhtar Ablyazov; Defendant/respondent: Syrym Shalabayev; Respondent: Clyde & Co LLP; Respondent: Stephenson Harwood LLP; Respondent: Addleshaw Goddard LLP
Jurisdiction
England and Wales
Judgment Date
08 August 2014
Procedural Posture
Commercial Court Asset Disclosure Application / Interlocutory Application for Disclosure and Ancillary Relief
Outcome
Application granted in substantial part
Legal Topics
Legal Professional Privilege, Iniquity Exception, Asset Disclosure, Freezing Orders, Receivership, Fraud, Contempt of Court
Civil Procedure Commercial Law Banking Law Legal Professional Privilege Iniquity Exception Asset Disclosure Freezing Orders Receivership +2 more

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Parties

JSC BTA Bank

Claimant

Mukhtar Ablyazov

Defendant/respondent

Syrym Shalabayev

Defendant/respondent

Clyde & Co LLP

Respondent

Stephenson Harwood LLP

Respondent

Addleshaw Goddard LLP

Respondent

Procedural Posture

Commercial Court Asset Disclosure Application / Interlocutory Application for Disclosure and Ancillary Relief

Legal Issues

  1. 1 Whether legal professional privilege applies to documents relating to assets of Mr Ablyazov and Mr Shalabayev held by their solicitors, or whether the iniquity exception applies due to fraud and contempt.
  2. 2 Whether the solicitors must disclose documents otherwise privileged under the iniquity exception.
  3. 3 Whether the Bank is entitled to ancillary declaratory and preservation relief.

Ratio Decidendi

There is a strong prima facie case that Mr Ablyazov and Mr Shalabayev engaged in a deliberate and systematic strategy of fraud, perjury, and concealment of assets, and that their solicitors were unwittingly used to further this iniquitous purpose. Accordingly, the iniquity exception to legal professional privilege applies, and the solicitors must disclose documents relating to the assets of Mr Ablyazov and Mr Shalabayev, as such communications do not attract privilege. The Bank is entitled to the disclosure sought, subject to safeguards for third-party privilege and proportionality.

Court Disposition

Application granted in substantial part

Orders

  • Solicitors (Clyde & Co LLP, Stephenson Harwood LLP, Addleshaw Goddard LLP) to disclose documents relating to the current and former assets of Mr Ablyazov and Mr Shalabayev, subject to safeguards for third-party privilege and proportionality.
  • Ancillary declaratory and preservation relief granted as appropriate.